Fed rules drive up cost of electricity

August 22, 2012

Federal air quality rules that are forcing the price of electricity up are bad enough. But Ohioans also are paying more solely because state legislators decided we ought to subsidize "alternative" energy.

Ohio has laws on the books mandating utilities to provide set percentages of power from non-conventional sources such as solar and wind generators. The Buckeye State's formula is more complex requires 12.5 percent of electricity from "renewable" energy by 2024 and 12.5 percent from "advanced energy" by 2025.

Of course, because the requirements were written by bureaucrats, utilities can meet them in all sorts of ways. Ohio power companies can buy renewable energy credits from other firms instead of building solar or wind generating stations or buying high-priced alternative energy from those who have such facilities.

A recent audit of three utilities in northeast Ohio found they paid millions of dollars more than necessary for such credits during the past couple of years. They could have saved money for consumers by simply paying state fines for non-compliance with the mandate.

But the companies went ahead and purchased the expensive credits because they were able to pass the cost on to consumers.

By whatever name they are called, state laws requiring utilities to spend more than necessary for electricity are, in a word, crazy.

Most power company executives don't mind because they know state regulators will allow them to pass the additional cost on to consumers.

Meanwhile, Ohio residents who may have a hard time paying the bills each month are being bled needlessly. Businesses that use large quantities of power find it more difficult to compete with companies in other states and countries.

At their very first opportunity, legislators should rescind the mandates.